NEW YORK (TheStreet) -- General Electric (GE) - Get Report is merging its oil and gas business with Baker Hughes (BHI) to form a new company that will be publicly traded on the New York Stock Exchange, with 62.5% of it owned by GE. 

The deal is a way for General Electric to experiment with "jamming together" technology and heavy equipment, as well as oil services and technology, Bloomberg News' Stuart Wallace said on BloombergTV's "Bloomberg Daybreak: Americas" on Monday morning. 

"It's going to be a little bit of both and I think they're trying to see if it will work. GE brings in effectively the software and Baker Hughes brings in the equipment," he explained. 

General Electric is thinking about the changes that have reshaped the industry since it first started building it and this new deal will help to set it apart in the transformed sector, Wallace added. "Marry those two off and hopefully you have a much stronger company and a much stronger offering in terms of being able to go out there to quite a beleagered industry and say, 'We can really offer you a full range of services. Here's our product book - it's twice the size that it used to be.'" 

Shares of Baker Hughes were higher in mid-morning trading on Monday, while shares of General Electric were lower. 

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TheStreet Ratings team rates General Electric as a Buy with a ratings score of B-. This is driven by multiple strengths, which the team believes should have a greater impact than any weaknesses, and should give investors a better performance opportunity than most stocks the team covers.

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